Free Trade Works for America and Her Neighbors

Posted on Monday, September 10, 2012 by Post Scripts
6746-NAFTA.jpg

Posted by Tina

Great story in The Washington Post about American made products sold in Mexico at big box stores like COSTCO:

The Costco was stocked with products stamped “Made in U.S.A.,” including some of the $755 million in goods that Colorado exports to Mexico each year: marbled slabs of steak from Greeley, cans of pinto beans from Holyoke and sacks of russet potatoes out of Monte Vista.

Trade between the United States and Mexico is surging, up 17 percent in 2011 to a record $461 billion, as Mexico vies with China to become America’s second-largest trading partner after Canada. China and the United States did $502 billion in trade last year. …

…Mexican exports to the United States have soared from $42 billion in 1993 to $263 billion in 2011, according to the Commerce Department. Almost 80 percent of Mexico’s exports go to the U.S. market, led by crude oil, fruits, vegetables, televisions, cellphones, computers and passenger vehicles.

What about trade with our Canadian neighbors? Here’s a few interesting facts:

More than 8 million U.S. jobs depend on Canada-U.S. trade

Canada is the top export destination for 35 states

Canada is the United States’ largest and most secure supplier of energy: oil, natural gas, electricity and nuclear fuel

Almost 400,000 people cross the Canada-U.S. border daily

The “Canadian State Trade Fact Sheet 2011” from which this information comes indicates an agreement…don’t know about follow-up on it though. Seems to me there was a little tiff concerning a pipeline…. Ah well, there’s always next year! These numbers are good but they will be even better when we improve our economy and jobs situation.

Read about Mitt Romney’ Ideas for trade relations and energy independence in a white paper entitled The Romney Plan for a Stronger Middle Class

A crucial component of Mitt Romney’s Plan for a Stronger Middle Class is to
dramatically increase domestic energy production and partner closely with Canada and Mexico to achieve North American energy independence by 2020

See fairly current NAFTA report for more information here.

There are many problems associated with our borders and with illegal immigration but there are also positives that I believe will make the all three nations stronger and our nation better for it.

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4 Responses to Free Trade Works for America and Her Neighbors

  1. Jim says:
    Monday, September 10, 2012 at 9:56 am

    You realize that corn is government subsidized, so much so that US corn is cheaper in Mexico than their local corn. Putting Mexican some farmers out of business. Corn is also used as livestock feed. So that beef that we export is also subsidized by our tax dollars.

  2. Post Scripts says:
    Monday, September 10, 2012 at 12:15 pm

    Jim, yes corn is subsidized, not sure how much or when, but I know it happens. I don’t agree with that or any subsidies unless it’s for reasons of national security.

  3. Tina says:
    Monday, September 10, 2012 at 4:47 pm

    Yes I do realize corn is subsidized and generally speaking I’m against subsidies. But did you know that they hide food stamp funding in the farm bills? I guess that way it looks like we’re spending less on welfare and entitlements:

    http://cnsnews.com/news/article/senate-passed-farm-bill-80-percent-food-stamps

    (CNSNews.com) Nearly 80 percent of the nearly $1 trillion Farm Bill will fund an expanded food stamp program that is projected to offer increased benefits long after economists expect the economy will have recovered.

    The bill, which passed the Senate June 21 on a 64-35 vote, would cost $969 billion over the next decade mostly for food stamps.

    Food stamps formally known as the Supplemental Nutrition Assistance Program (SNAP) account for $768 billion of the bills ten-year total, or 79 percent of the Senate bills total funding. In total, CBO estimates that enacting the [SNAP] provisionswould cost $768.2 billion, The Congressional Budget Office (CBO) said in a June estimate of the bill.

    The remaining 11 percent goes to fund the myriad of federal farm subsidies that give the Farm Bill its name, such as wetland conservation programs, price supports, and crop insurance.

    Of course we made matters much worse when we decided to use corn for fuel:

    http://www.motherjones.com/kevin-drum/2012/01/ethanol-subsidies-not-gone-just-hidden-little-better

    It turns out that corn farmers really don’t care about ethanol subsidies all that much anymore, but there’s a reason for that. Here is our own Tom Philpott writing in February 2010:

    After a flirtation with reason last spring, the Obama EPA has signed off on the absurd, abysmal Renewable Fuel Standard established under Bush a couple of years agoensuring that farmers will continue to devote vast swaths of land to GHG-intensive corn, of which huge portion will ultimately be set aflame to power carsbut not before being transformed into liquid fuel in an energy-intensive process.

    Tom’s a liberal. Here is Aaron Smith, writing a couple of days ago for the conservative American Enterprise Institute:

    Deficit hawks, environmentalists, and food processors are celebrating the expiration of the ethanol tax credit. This corporate handout gave $0.45 to ethanol producers for every gallon they produced and cost taxpayers $6 billion in 2011. So why did the powerful corn ethanol lobby let it expire without an apparent fight? The answer lies in legislation known as the Renewable Fuel Standard (RFS), which creates government-guaranteed demand that keeps corn prices high and generates massive farm profits. Removing the tax credit but keeping the RFS is like scraping a little frosting from the ethanol-boondoggle cake.

    The RFS mandates that at least 37 percent of the 2011-12 corn crop be converted to ethanol and blended with the gasoline that powers our cars[As a result] the current price of corn on the Chicago Mercantile Exchange is about $6.50 per bushelalmost triple the pre-mandate level.

    As the Congressional Budget Office wrote back in 2010, “In the future, the scheduled increase in mandated volumes would require biofuels to be produced in amounts that are probably beyond what the market would produce even if the effects of the tax credits were included.” [Italics mine.] In other words, the mandates have grown so large that the tax credits barely made a difference anymore. Demand for ethanol is driven by the mandates, not by the tax credit. When you take away the tax credit, nothing happens: Demand stays high because the law says so, corn prices go up accordingly, and corn farmers stay rich. The subsidies were a nice little fillip on top of that, but at this point it’s basically chump change.

    I don’t mind if farmers make money they work hard and they have to put up with a lot of problems of nature that hurt them…but the ethanol law is just stupid for many reasons!

    This year you and the Mexican farmers will have less to worry about:

    http://www.moneynews.com/Markets/drought-Corn-food-soy/2012/08/10/id/448145

    Wetter, cooler weather was moving into the drought-stricken U.S. crop belt on Friday, and while the change comes too late to benefit the devastated corn crop, it may give some solace to soy.

    As the worst drought in over a half century took its toll, investors went on a buying spree, boosting corn prices by more than 50 percent from late May to fresh record highs above $8 per bushel.

    The better crop weather was expected in the U.S. Midwest on Friday and through next week, which will help some late-planted soybeans, but it’s too late for corn, an agricultural meteorologist said.

    The good news in the trade article is that the middle class is growing in Mexico. within another ten to twenty years that will make a tremendous difference in our hemisphere in terms of prosperity and immigration. As the citizens of Mexico begin to enjoy a better life inequalities will melt away.

    Hopefully we can find ways to help farmers and others manage their financial ups and downs without just handing out money or inflating profits for what turns out to be an unpopular fuel.

    You know when government stays out of things people invest their own money carefully and prudently…sometimes they get to learn the hard way but at least they learn!

  4. Jim says:
    Monday, September 10, 2012 at 8:16 pm

    The corn subsidy was ok, back when we were trying to get more affordable food. It was a Nixon programs as I recall to help fight hunger in American. Well like most government programs, they don’t end when the need for them ends. This has gone on too long and it’s should stop, except there is that dang Iowa caucus. Ending the corn subsidy woulden’t make you very popular there.

    The food stamp thing is another mess. I don’t believe that we should let kids go hungry, however it is really a handout to the supermarkets and farmers. That is why it’s in the farm bill. The problem is that you can buy almost any junk with food stamps, even candy and soda. The WIC program is much better managed. With WIC you can only buy the basics, no junk food.

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